A former Shoppers Stop veteran and ex-IBM executive, Rajagopalan is considered by many as one of the architects of brick-and-mortar’s fight against ecommerce.Rasul Bailay | ET Bureau | July 22, 2016, 12:29 IST

A former Shoppers Stop veteran and ex-IBM executive, Rajagopalan is considered by many as one of the architects of brick-and-mortar's fightback against ecommerce.Retailers Association of India (RAI) till recently, was like any typical industry body, spending most its energy on organising retail events and training programmes.

But over the past two years or so, led by its chief executive officer Kumar Rajagopalan, RAI has changed its course altogether — it’s now lobbying hard for the industry and even taking the deep-pocketed ecommerce companies head-on.

The autumn of 2014 is seen by many as a watershed moment in Indian retailing industry when e-commerce giants such as Flipkart and Amazon, with billions of foreign money in their kitties, offered deep discounts in their Diwali sales, not seen in the country before, and within a matter of days they recorded hundreds of millions in sale.

The development stunned brick-and-mortar retailers as it affected their crucial festive season sale, but it also brought together traditional retailers to fight for their survival.

“Definitely e-commerce has been a rallying point (for offline retailers) as we have been advocating for creating a level-playing field for the industry,” said J Suresh, CEO at Arvind Lifestyle Brands. The fight between traditional retailers and e-commerce companies also brought RAI CEO Rajagopalan — a trained chartered accountant — into the limelight.

A former Shoppers Stop veteran and ex-IBM executive, Rajagopalan is considered by many as one of the architects of brick-and-mortar’s fightback against e-commerce.

In that process, Rajagopalan, along with other key members, converted the once sleepy RAI into one of the most active lobby groups in the country, nudging the government to ultimately come up with rules that barred e-commerce marketplaces from influencing retail prices directly or indirectly. “Our issue has been for a level playing field and it has never been offline vs online,” said BS Nagesh, former MD of Shoppers Stop.

Several retail heads give Rajagopalan credit for RAI’s effectiveness. “He comes from the retail industry, so he has a good understanding of retail and is using his knowledge to build the last mile connect with the bureaucracy and with various implementing agencies of the government,” said Rakesh Biyani, director at Future Group.

RAI fired its first salvo against e-commerce in May last year when it filed a case in the Delhi High Court, alleging online retailers of misappropriating their foreign funding by deploying overseas capital in consumer retailing, which India bars. Then, in September, footwear manufacturers and retailers in the country filed a similar case in Delhi, alleging “rampant illegalities” by ecommerce companies in “complete violation” of FEMA and FDI rules.

Those two lawsuits ultimately prompted the government to come up with a legislation on FDI in marketplaces. Even as e-commerce companies themselves are majorly fragmented, they see RAI as a strong lobby group and some of them term RAI as a brick-and-mortar cartel.

The association lobbies with states and played a role in the retail policies of some states that permit 365 days opening of stores and allow farmers to bypass APMC mandis to sell directly to retailers.

“The most important thing is that we are supporting modernisation of retail to help the industry to the next level of growth,” Rajagopalan said. “Biggest thing is to make the industry healthy as the sector is still not profitable at a total level.” Retailers are voting for Rajagopalan’s proposals with their wallets.

“Kumar is somebody who understands retail. He has been given full freedom to operate in RAI,” said Nagesh of Shoppers Stop.